We comment on a number of tentative agenda decisions of the IFRS Interpretations Committee

31 Jan 2017

We have published our comment letters on IFRS Interpretations Committee agenda decisions on IAS 28, IFRS 10, and commodity loans, as published in the November 2016 IFRIC Update.

More information about the issues is set out below:

Issue Agenda decision supported? More information
IAS 28 Investments in Associates and Joint Ventures — Fund manager's assessment of significant influence yes
IFRS 10 Consolidated Financial Statements — Investment entities and subsidiaries yes
Guidance on the accounting for a commodity loan transaction yes

You can access all our comment letters to the IASB, IFRS Foundation, and IFRS Interpretations Committee here.

Final Tommaso Padoa-Schioppa lecture to be delivered by Jean-Claude Trichet

30 Jan 2017

Jean-Claude Trichet, president of the European Central Bank from 2003 to 2011, will deliver the final Tommaso Padoa-Schioppa lecture in connection with the IFRS Foundation Trustees' meeting in Paris on 1 February 2017.

The Tommaso Padoa-Schioppa Memorial Lecture, inaugurated in 2014 by the IFRS Foundation and the Padoa-Schioppa family, will be preceeded by a welcome address by Michel Prada, Chairman of the IFRS Foundation Trustees, and will be followed by a panel discussion on ‘Accounting post financial crisis – Lessons drawn and new challenges’ featuring Patrick de Cambourg, President of the ANC, Frédéric Oudéa, Chief Executive Officer of Société Générale, Steven Maijoor, Chair of ESMA, and Hans Hoogervorst, Chair of the IASB. The panel will be moderated by Nicolas Véron, Senior Fellow at Bruegel.

The event is by invitation only, however, in the past, videos or transcripts of the Tommaso Padoa-Schioppa Memorial Lecture were usually made available after the event.

EFRAG research into dynamic risk management

30 Jan 2017

In 2016, the European Financial Reporting Advisory Group (EFRAG) conducted targeted outreach to support the development of a new, high quality macro-hedge accounting solution by the IASB. The outreach was a fact finding exercise focused on gaining a better understanding of banks’ practices in connection with their management of interest rate risk. EFRAG has now published a report on the findings.

The outreach among 15 banks confirmed that current hedge accounting requirements do not fully accommodate the way a bank manages interest rate risk. Particular challenges are:

  • The use of open portfolios,
  • the fact that interest rate risk is managed using net positions instead of gross positions, and
  • the difficulties of designating particular items as part of a hedge accounting relationship.

While IFRS 9 has accommodated some of the above issues a comprehensive solution for dynamic risk management is still lacking. Therefore, EFRAG's fact finding exercise, which also includes theoretical background to the range of practices employed by banks and considers both the risk management and the accounting perspectives, is meant to help the IASB in developing an improved approach to reporting the effect of dynamic risk management activities in the financial statements.

Please click to access the press release and the outreach report on the EFRAG website.

Agenda published for the January/February 2017 IFRS Foundation Trustees meeting

27 Jan 2017

The agenda for the public session of the upcoming meeting of the IFRS Foundation Trustees is now available. The Trustees will meet from 31 January to 2 February 2017 in Paris.

The agenda for the public session of the meeting is summarised below.

Tuesday, 31 January 2017

IFRS Foundation Trustees meeting (15:30–16:40)

  • Introduction and actions from the first public DPOC meeting, held on 13 October 2016
  • Technical activities: Key issues and update
  • Effects analysis: presentation on the insurance contracts Standard
  • Implementation activities for the insurance contracts Standard
  • Research Programme including due process on the share-based payment project
  • Materiality practice Statement: presentation on due process
  • IFRS 9 Financial Instruments: Comment letter period for narrow scope amendment
  • IFRS Taxonomy Consultative Group: Terms of reference
  • Correspondence: update

Agenda papers for the meeting are available on the IASB's website.

IASB podcast on latest Board developments

26 Jan 2017

The IASB has released a podcast featuring its Chair, Hans Hoogervorst and Vice-Chair, Sue Lloyd discussing the deliberations at the January 2017 IASB meeting.

In the 10-minute podcast, Mr Hoogervorst and Ms Lloyd discuss the upcoming insurance contracts Standard, the planned post-implementation review of IFRS 13 Fair Value Measurement, the planned narrow-scope amendment to IFRS 9, Financial Instruments, and Board's plans for 2017, including a discussion paper on the principles of disclosure and the final Statement on materiality practice (both planned for the first half of 2017).

The podcast is available on the IASB's website. For more information about the January 2017 IASB meeting, see our comprehensive notes taken by Deloitte observers.

ECON exchange of views with Hans Hoogervorst and Michel Prada

26 Jan 2017

At the annual exchange of views between the Committee on Economic and Monetary Affairs (ECON) of the European Parliament and representatives of the IASB and the IFRS Foundation, IASB Chairman Hoogervorst and Michel Prada, Chairman of the IFRS Foundation Trustees, stood ready to answer questions of the Parliamentarians.

The session began with re-elected ECON Chairman Roberto Gualteri welcoming Mr Hoogervorst and Mr Prada and stressing that relations between the European Parliament and the IASB had markedly improved over the last few years, which he took to be a good sign.

Mr Hoogervorst then made a few short introductory remarks mainly on the forthcoming new standard on insurance contracts (currently expected in May 2017), on which he also promised a full-fledged effect analysis, and on the better communication theme the IASB has set for its work programme 2017-2021. Regarding the latter, he expanded on performance reporting, non-GAAP measures, primary financial statements, digital reporting, and, to a certain extent, integrated reporting.

Afterwards, there was a broad range of questions from the Parliamentarians ranging from very broad to very detailed. There were for example questions regarding whether the election of Mr Trump in the United States would have an effect on the international financial reporting landscape (Mr Hoogervorst responded that "make US GAAP great again" had been a motto of US accounting well before the election) and regarding diversity (30% female Board members, on the staff more female than male members).

Technical questions that drew the most attention were the amendments to IFRS 4 regarding the application of IFRS 9 together with IFRS 4. While Parliamentarians acknowledged the positive endorsement advice EFRAG hat published in January, they noted concerns regarding the cost component (which EFRAG had not been able to assess) and also asked why the deferral approach would not be available to conglomearates. Mr Hoogervorst repeated the IASB's belief that having two different standards applied in the same company did not seem desirable and that the overlay approach would provide conglomerates with a solution to their problems.

Another topic that was approached from different angles was the frequency of amendments to IFRSs. This was discussed from the perspective of balance between stable platform and necessary maintenance and also from the perspective of post-implementation reviews. The question was whether more detailed effect analyses could help reduce the amount of necessary amendments that are identified as result of post-implementation reviews. There was also some confusion as to whether making minor improvements to a standard as a result of a post-implementation reviews meant "re-opening" of a standard.

Generally, the session suffered slightly from translation mistakes and inaccuracies as well as from other minor misunderstandings, which however were overcome by joint efforts from both sides and the offer to answer the remaining questions by email.

For more information, see the video recording of the ECON meeting. (Please note that the recording, including Mr Hoogervorst's introductory remarks, can be watched in any of the EU's official languages).

Summary of the December 2016 ASAF meeting now available

24 Jan 2017

The staff of the International Accounting Standards Board (IASB) have made available a summary of the discussions of the Accounting Standards Advisory Forum (ASAF) meeting held in London on 8–9 December 2016.

The topics covered during the meeting were the following (numbers in brackets are references to the corresponding paragraphs of the summary):

  • Conceptual Framework for Financial Reporting (1–14): ASAF members discussed the definition of a liability and supporting concepts as well as IASB staff recommendations for the approach to capital maintenance.
  • Country-by-country reporting (15–19): Australia's AASB sought the views of ASAF members on proposals to improve the understandability of disclosures to comply with IAS 12 Income Tax.
  • IFRS 13 Fair Value Measurement—Post -implementation Review (20–27): ASAF members discussed feedback from Phase 1 of the PIR of IFRS 13 and gave advice on next steps.
  • Rate-regulated Activities (28–39): ASAF members considered whether the staff’s preliminary proposals for a new accounting model for rate-regulated activities addressed their previously expressed concerns about: (1) scope of the model, (2) interactions with other IFRS Standards and the Conceptual Framework, and (3) segregating identifiable rate adjustments from the overall changes in value of the regulatory licence/agreement.
  • Disclosure Initiative (40–48): The IASB staff provided an update on the progress of a report that will provide examples of entities that have improved the way they communicate in their financial statements.
  • Digital currency (49–58): A paper was introduced asking ASAF members for their views on whether and how the Board should address digital currency issues. After a discussion, the IASB decided to continue monitoring developments in this area.
  • Financial Instruments with Characteristics of Equity (59–61): The IASB staff updated the ASAF members and asked for input on the Financial Instruments with Characteristics of Equity research project and its outreach.
  • Insurance Contracts project (62–70): ASAF members were updated on IFRS 17 Insurance Contracts, including the IASB’s tentative decisions at its November 2016 meeting and the next steps for the publication of the new Standard, which is expected in March 2017. (Note: The expected date has by now been delayed to May 2017 as result of the January 2017 IASB meeting.)
  • Update by ASAF members on activities (71): ASAF members gave an update on their activities.
  • Project updates and agenda planning (72): ASAF members were updated on current IASB projects.

A full summary of the meeting is available on the IASB's website.

Two related studies on non-GAAP financial measures

23 Jan 2017

The CFA Institute, a global association of investment professionals, has published 'Investor Uses, Expectations and Concerns on Non-GAAP Financial Measures' and 'Bridging the Gap: Ensuring Effective Non-GAAP and Performance Reporting'.

The first paper is informed by a survey of CFA Institute members and sheds light on investor uses, expectations, and concerns on non-GAAP financial measures. It establishes that company-reported non-GAAP financial measures are useful for investors who apply them for varied reasons but who also make further adjustments including reversing questionable adjustments. The survey also shows that investors have concerns around the communication, consistency, comparability across periods and similar companies, and transparency of non-GAAP financial measures.

The second paper builds on the first one and articulates actions required to improve communication of these measures and enhance the overall performance reporting framework. For instance, the investors surveyed believe that securities regulators have a vital role in imposing discipline around the reporting of non-GAAP financial measures. And they are of the view that concerns around non-GAAP financial measures should serve as a catalyst for the IASB and the FASB to enhance their primary financial statements’ presentation and classification requirements, including defining key subtotals.

Both papers can be downloaded from the CFA Institute's website:

January 2017 IASB meeting notes posted

23 Jan 2017

The IASB met at its offices in London on 18 January 2017. We have posted our comprehensive Deloitte observer notes for all projects discussed during the meeting.

The first meeting for 2017 had a light agenda, with the IASB meeting in public on Wednesday 18 January 2017.

Exposure drafts and Standards

The Board continued its discussions from December 2016 on a possible amendment to IFRS 9 Financial Instruments in relation to symmetric prepayment options, to allow instruments with a prepayment options to qualify for amortised cost measurement. The Board decided to proceed to issue an exposure draft, with the goal of finalising the amendment so that it can have an effective date of 1 January 2018.

The staff gave the Board an oral update on the Insurance Contracts project. They need to bring some minor issues back to the Board in February as a result of the feedback they received from an extended fatal flaw review. This will push the expected publication date for IFRS 17 Insurance Contracts to May 2017.

The Board was told that the staff had received positive feedback from testing the wording of an exposure draft to clarify the difference between an accounting policy and a change in estimate.


The Conceptual Framework session focused on factors specific to initial measurement and the use of more than one measurement basis. The Board also confirmed the proposals to update the references in Standards and Interpretations to the Conceptual Framework.


The first session focused on a post-implementation review of IFRS 13 Fair Value Measurement. The requirements in IFRS 13 are substantially the same as those in the FASB’s requirements, the two boards having worked to have converged standards. The Board decided to move ahead with a post-implementation review and to issue a request for information as part of that process. The request for views is expected to be published within the next six months.

More information

Please click to access the detailed notes taken by Deloitte observers for the entire meeting.

Summary of the November 2016 GPF meeting

20 Jan 2017

Representatives of the IASB met with the Global Preparers Forum (GPF) in London on Tuesday, 29 November 2016. Notes from the meeting have now been released.

The topics discussed at the meeting included:

  • IASB and Interpretations Committee Update. Members were given an overview of the IASB's work plan and how it reflects the messages received during the Board’s 2015 Agenda Consultation. They discussed the relevance of IFRSs in view of the recent developments in integrated reporting and the increasing use of alternative performance measures. They also considered the process with respect to national standard-setters’ projects that contribute to IASB projects.
  • Post-implementation Review of IFRS 13 Fair Value Measurement. As a part of phase 1 of the review, the staff sought feedback from the GPF members on their experience with implementing IFRS 13. The GPF members noted that IFRS 13 was generally working well but commented on some smaller matters.
  • Education Initiative commercial publications. The purpose of the session was to discuss possible improvements to A Guide through IFRS Standards (the ‘Green Book’) and A Briefing for Chief Executives, Audit Committees and Boards of Directors. As regards the Green Book, members commented on the basis of preparation, possible modifications, format of publication, and language and timing. On the second publication, members questioned whether the format of the publication was appropriate for the target audience and made several suggestions in this regard.
  • Definition of a business. The purpose of this session was to understand and discuss GPF members’ views on the exposure draft. Views were mixed and comments diverse.

The next GPF meeting will be held on 8 March 2017. The full meeting summary is available on the IASB's website.

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